Cost final Cpt 17

1. 1Which of the following companies is most likely to use process costing?

   1. ACrimpson Color, a company selling customized garments for niche customers
   2. BEffel & Associates, a consulting firm providing various audit and related services
   3. CRed Paste Inc., a company manufacturing and selling toothpaste on a large scale
   4. DGrimpy Corp., a company manufacturing furniture for customers as per their requirements
2. 2Which of the following statements is true of conversion costs?

   1. AIn process costing, they include all the factors of production.
   2. BThey include all manufacturing costs including direct materials, direct labor, and other direct and indirect manufacturing costs.
   3. Cn process costing, they are usually considered to be added evenly throughout the production process.
   4. DThey include only direct materials and excludes all other manufacturing and non-­‐‑manufacturing costs.
3. 3Which of the following statements best describes conversion costs?

   1. AConversion costs are all manufacturing and nonmanufacturing cost.
   2. BConversion costs are all manufacturing costs other than direct materials costs.
   3. CConversion costs are all nonmanufacturing costs including marketing costs.
   4. DConversion costs are all nonmanufacturing costs other than fixed selling and distribution costs.
4. 4 The purpose of the equivalent-­‐‑unit computation is to ________.

   1. Aconvert completed units into the amount of partially completed output units that could be made with that quantity of input
   2. Bassist the business in determining the cost assigned to ending inventory and work-­‐‑in-­‐‑process inventory
   3. Cpredict the future production capabilities of the organization
   4. Dsatisfy the GAAP requirements which requires all partially completed goods to be reported as equivalent-­‐‑units
5. 5The weighted-­‐‑average process-­‐‑costing method calculates the equivalent units by ________.

   1. Aconsidering only the work done during the current period
   2. Bthe units started during the current period minus the units in ending inventory
   3. Cthe units started during the current period plus the units in ending inventory
   4. Dthe equivalent units completed during the current period plus the equivalent units in ending inventory
6. 6When a Bakery transfers goods from the Mixing Department to the Baking Department, the accounting entry is ________.

   1. AWork in Process — Mixing Department
      Work in Process — Baking Department
   2. BWork in Process — Baking Department
      Accounts Payable
   3. CWork in Process — Baking Department
      Work in Process — Mixing Department
   4. DWork in Process — Mixing Department
      Accounts Payable
7. 7 If there was no beginning work in process and no ending work in process under the weighted-­‐‑average process costing method, the number of equivalent units for direct materials, if direct materials were added at the start of the process, would be ________.

   1. Amore than the units started or transferred in during the period
   2. Bequal to the units completed during the period
   3. Cless than the units completed during the period
   4. Dequal to total of units started and units completed during the period
8. 8A distinct feature of the FIFO process-­‐‑costing method is that the ________.

   1. Awork done on beginning inventory before the current period is blended with the work done during the current period in the calculation of equivalent units
   2. Bwork done on beginning inventory before the current period is kept separate from the work done during the current period in the calculation of equivalent units
   3. Cwork done on ending inventory is kept separate from the work done during the current period in the calculation of equivalent units and is usually not included in the calculation
   4. DFIFO process-­‐‑costing method is only minimally different from the weighted-­‐‑average process-­‐‑costing method
9. 9On occasion, the FIFO and the weighted-­‐‑average methods of process costing will result in the same dollar amount of costs being transferred to the next department. Which of the following scenarios would have that result?

   1. Awhen the beginning and ending inventories are equal in terms of unit numbers
   2. Bwhen the beginning and ending inventories are equal in terms of the percentage of completion for both direct materials, and conversion costs
   3. Cwhen there is no ending inventory
   4. Dwhen there is no beginning inventory

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Midterm Cost Accounting Quiz on Cost final Cpt 17, created by Rebecca Escobar on 20/05/2016.

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Rebecca Escobar

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